Government-guaranteed debt issued by Banco Espirito Santo upgraded to Ba1 from Ba2
Madrid, July 29, 2014 -- Moody's Investors Service has today affirmed the debt and deposit
ratings and maintained the corresponding outlooks of the following Portuguese
banks:
(i) Caixa Geral de Depositos, S.A. (CGD): long-and
short-term senior debt and deposit ratings affirmed at Ba3/Not-Prime
with a negative outlook
(ii) Banco Comercial Portugues, S.A. (BCP):
affirmed at B1/Not-Prime with a negative outlook
(iii) Banco BPI S.A. (BPI): affirmed at Ba3/ Not-Prime
with a negative outlook
(iv) Banco Santander Totta S.A. (BST): affirmed at
Ba1/ Not-Prime with a stable outlook
(v) Caixa Economica Montepio Geral (Montepio): affirmed at B2/ Not-Prime
with a negative outlook
(vi) BANIF-Banco Internacional do Funchal, S.A.
(Banif): affirmed at Caa1/ Not-Prime with a negative outlook
The long-term debt and deposit ratings on Banco Espirito Santo,
S.A. (BES) remain on review for downgrade. For further
detail, please see "Moody's downgrades Banco Espirito Santo's
debt ratings to B3, deposit ratings to B2; ratings remain on
review for downgrade"(https://www.moodys.com/research/PR_303875).
At the same time, Moody's has upgraded the government-guaranteed
debt ratings of BES to Ba1 from Ba2 and assigned a stable outlook.
These rating actions follow the upgrade of the government bond ratings
of Portugal to Ba1 with a stable outlook, implemented on 25 July
2014 (for further details please see https://www.moodys.com/research/PR_304267).
A list of all affected ratings is available at the end of this press release.
RATINGS RATIONALE
RATIONALE FOR DEBT AND DEPOSIT RATINGS
Today's rating action on Portuguese banks follows the recent upgrade
of the Portuguese sovereign bond ratings.
Moody's believes that the likelihood of support from the government assigned
to each bank remains materially unchanged, underpinning the affirmation
of the supported ratings of Portuguese banks.
In addition, the negative outlooks on CGD, BCP, BPI,
Montepio and Banif's long-term debt and deposit ratings reflect
the high likelihood that current systemic support assumptions embedded
in ratings may be lowered in the context of the implementation of "Bank
Recovery and Resolution Directive" (BRDD). Please see the
special comment "Reassessing systemic support for EU banks"
(https://www.moodys.com/research/PBC_170460) published
by Moody's for further detail.
The long-term debt and deposit ratings of BES remain on review
for downgrade due to the uncertainties on the full extent of the financial
liabilities that could emerge for BES from its holding company ESFG and
from other parts of the Espirito Santo Group. The downward bias
of the review reflects the downside risks to BES's standalone credit strength
should the bank be required to support any of the Espirito Santo Group
companies or become liable for any of its obligations.
The stable outlook on BST's long-term debt and deposit ratings
is based on the stable outlook of its standalone rating. It reflects
our view that the downside risks to the bank's credit profile have substantially
diminished. Throughout the economic recession and banking system
challenges of the last several years in Portugal, BST has demonstrated
a continuing ability to generate capital internally despite a significant
pick-up of its non-performing loans (NPLs) and subdued business
activities. The stable outlook on BST's ratings is further underpinned
by the stable outlook on the ratings of its parent Banco Santander S.A.
(deposits Baa1 stable, BFSR C- stable/BCA baa1); and
the stable outlook of Portugal's Ba1 government rating.
RATIONALE FOR GOVERNMENT-GUARANTEED DEBT
Moody's rates Portuguese government-guaranteed debt at the
sovereign rating level. The rating on the government-backed
debt of BES has therefore been aligned with Portugal's Ba1 government
bond rating (stable outlook).
WHAT COULD CHANGE THE RATINGS UP/DOWN
Any upward pressure on the banks' ratings is currently unlikely,
given their relatively weak intrinsic financial strength and ongoing downward
pressure stemming mostly from a weak profitability and still high asset
quality challenges. The current uplift due to systemic support
also incorporates the availability of EUR6.4 billion in the government's
recapitalisation facility fund (prefunded by the Troika) to inject into
the banks should further support be needed.
Moody's could also downgrade Portuguese banks' senior debt and deposit
ratings as a result of the evolution of systemic support prospects in
Portugal and in the EU, in light of developments associated with
resolution mechanisms and burden sharing for European banks. In
addition, a lowering of the BCA and/or a downgrade of Portugal's
sovereign rating could prompt a downgrade of the senior ratings.
LIST OF AFFECTED RATINGS
Upgrades:
..Issuer: Banco Espirito Santo, S.A.
....Backed Senior Unsecured Regular Bond/Debenture,
Upgraded to Ba1 from Ba2
Affirmations:
..Issuer: Banco BPI Cayman Ltd
....Backed Multiple Seniority Medium-Term
Note Program, Affirmed (P)NP
....Backed Multiple Seniority Medium-Term
Note Program, Affirmed (P)Ba3
....Backed Senior Unsecured Commercial Paper,
Affirmed NP
..Issuer: Banco BPI S.A.
.... Issuer Rating, Affirmed Ba3
.... Deposit Rating, Affirmed NP
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)NP
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)Ba3
....Senior Unsecured Regular Bond/Debenture,
Affirmed Ba3
....Senior Unsecured Deposit Rating,
Affirmed Ba3
..Issuer: Banco BPI S.A. (Cayman)
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)NP
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)Ba3
....Senior Unsecured Regular Bond/Debenture,
Affirmed Ba3
..Issuer: Banco BPI S.A. (Madeira)
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)NP
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)Ba3
..Issuer: Banco BPI S.A. (Santa Maria)
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)NP
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)Ba3
..Issuer: Banco Comercial Portugues, S.A.
.... Deposit Rating, Affirmed NP
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)B1
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)NP
....Senior Unsecured Regular Bond/Debenture,
Affirmed B1
....Senior Unsecured Deposit Rating,
Affirmed B1
..Issuer: Banco Comercial Portugues, SA,
Macao Br
.... Deposit Rating, Affirmed NP
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)B1
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)NP
....Senior Unsecured Deposit Rating,
Affirmed B1
..Issuer: Banco Comercial Portugues, SA,
Madeira
....Backed Senior Unsecured Commercial Paper,
Affirmed NP
..Issuer: Banco Santander Totta S.A.
.... Deposit Rating, Affirmed NP
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)NP
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)Ba1
....Senior Unsecured Commercial Paper,
Affirmed NP
....Senior Unsecured Regular Bond/Debenture,
Affirmed Ba1
....Senior Unsecured Deposit Rating,
Affirmed Ba1
..Issuer: Banco Santander Totta S.A.,
London
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)NP
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)Ba1
..Issuer: BANIF-Banco Internacional do Funchal,
S.A.
.... Deposit Rating, Affirmed NP
....Senior Unsecured Regular Bond/Debenture,
Affirmed Caa1
....Senior Unsecured Deposit Rating,
Affirmed Caa1
..Issuer: BCP Finance Bank, Ltd.
....Backed Multiple Seniority Medium-Term
Note Program, Affirmed (P)B1
....Backed Multiple Seniority Medium-Term
Note Program, Affirmed (P)NP
....Backed Senior Unsecured Commercial Paper,
Affirmed NP
....Backed Senior Unsecured Regular Bond/Debenture,
Affirmed B1
..Issuer: BPI Capital Finance Ltd.
....Backed Multiple Seniority Medium-Term
Note Program, Affirmed (P)NP
....Backed Multiple Seniority Medium-Term
Note Program, Affirmed (P)Ba3
..Issuer: Caixa Economica Montepio Geral
.... Deposit Rating, Affirmed NP
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)B2
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)NP
....Senior Unsecured Regular Bond/Debenture,
Affirmed B2
....Senior Unsecured Deposit Rating,
Affirmed B2
..Issuer: Caixa Economica Montepio Geral, Cay.
Is. Br.
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)B2
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)NP
....Senior Unsecured Regular Bond/Debenture,
Affirmed B2
..Issuer: Caixa Geral de Depositos Finance
....Backed Multiple Seniority Medium-Term
Note Program, Affirmed (P)NP
....Backed Multiple Seniority Medium-Term
Note Program, Affirmed (P)Ba3
....Backed Senior Unsecured Commercial Paper,
Affirmed NP
..Issuer: Caixa Geral de Depositos, S.A.
.... Deposit Rating, Affirmed NP
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)NP
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)Ba3
....Backed Senior Unsecured Commercial Paper,
Affirmed NP
....Senior Unsecured Regular Bond/Debenture,
Affirmed Ba3
....Senior Unsecured Deposit Rating,
Affirmed Ba3
..Issuer: Caixa Geral de Depositos, S.A.
(London)
....Backed Senior Unsecured Commercial Paper,
Affirmed NP
..Issuer: Caixa Geral de Depositos, S.A.
(Madeira)
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)NP
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)Ba3
....Backed Senior Unsecured Commercial Paper,
Affirmed NP
..Issuer: Caixa Geral de Depositos, S.A.
(Paris)
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)NP
....Multiple Seniority Medium-Term
Note Program, Affirmed (P)Ba3
....Senior Unsecured Commercial Paper,
Affirmed NP
....Senior Unsecured Regular Bond/Debenture,
Affirmed Ba3
..Issuer: Caixa Geral de Depositos/New York
....Senior Unsecured Deposit Rating,
Affirmed Ba3
..Issuer: CGD NORTH AMERICA FINANCE LLC
....Backed Senior Unsecured Commercial Paper,
Affirmed NP
..Issuer: TOTTA (IRELAND) p.l.c.
....Backed Senior Unsecured Commercial Paper,
Affirmed NP
PRINCIPAL METHODOLOGY
The principal methodology used in these ratings was Global Banks published
in July 2014. Please see the Credit Policy page on www.moodys.com
for a copy of this methodology.
REGULATORY DISCLOSURES
For ratings issued on a program, series or category/class of debt,
this announcement provides certain regulatory disclosures in relation
to each rating of a subsequently issued bond or note of the same series
or category/class of debt or pursuant to a program for which the ratings
are derived exclusively from existing ratings in accordance with Moody's
rating practices. For ratings issued on a support provider,
this announcement provides certain regulatory disclosures in relation
to the rating action on the support provider and in relation to each particular
rating action for securities that derive their credit ratings from the
support provider's credit rating. For provisional ratings,
this announcement provides certain regulatory disclosures in relation
to the provisional rating assigned, and in relation to a definitive
rating that may be assigned subsequent to the final issuance of the debt,
in each case where the transaction structure and terms have not changed
prior to the assignment of the definitive rating in a manner that would
have affected the rating. For further information please see the
ratings tab on the issuer/entity page for the respective issuer on www.moodys.com.
For any affected securities or rated entities receiving direct credit
support from the primary entity(ies) of this rating action, and
whose ratings may change as a result of this rating action, the
associated regulatory disclosures will be those of the guarantor entity.
Exceptions to this approach exist for the following disclosures,
if applicable to jurisdiction: Ancillary Services, Disclosure
to rated entity, Disclosure from rated entity.
The below contact information is provided for information purposes only.
Please see the ratings tab of the issuer page at www.moodys.com,
for each of the ratings covered, Moody's disclosures on the
lead analyst and the Moody's legal entity that has issued the ratings.
Regulatory disclosures contained in this press release apply to the credit
rating and, if applicable, the related rating outlook or rating
review.
Please see www.moodys.com for any updates on changes to
the lead rating analyst and to the Moody's legal entity that has issued
the rating.
Please see the ratings tab on the issuer/entity page on www.moodys.com
for additional regulatory disclosures for each credit rating.
Maria Vinuela
Analyst
Financial Institutions Group
Moody's Investors Service Espana, S.A.
Calle Principe de Vergara, 131, 6 Planta
Madrid 28002
Spain
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454
Johannes Felix Wassenberg
MD - Banking
Financial Institutions Group
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454
Releasing Office:
Moody's Investors Service Espana, S.A.
Calle Principe de Vergara, 131, 6 Planta
Madrid 28002
Spain
JOURNALISTS: 44 20 7772 5456
SUBSCRIBERS: 44 20 7772 5454
Moody's affirms debt and deposit ratings of 6 Portuguese banks further to sovereign upgrade
